Home Selling in Fremont>Question Details

Lakisha, Home Buyer in San Jose, CA

Should I list my house at lower price to attract many offers?

Asked by Lakisha, San Jose, CA Fri Jun 21, 2013

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Answers

17
Two answers:

No. And...

Ask your Realtor.

Why "no"?

First, you could be "leaving money on the table," especially if those offers don't result in a bidding war. Example: Let's say your property (based on you and your agent's best estimates) is worth $400,000. But you price it at $370,000 to "attract many offers."

And you do get many offers--ranging from $365,000 to $380,000. Whoops. Your strategy "worked" with the multiple offers, but might have just cost you $20,000.

Then, again, you might not get multiple offers. You've priced it at $370,000, and you get a nice, full price offer of $370,000. Whoops!

Or you get those multiple offers. You're getting them from people who are probably qualified up close to the maximum of their offer. They might want to be able to offer more, but that person who offered $365,000 maybe can go up to $375,000. That person who offered $380,000? He might be stretching it as is. They may not be able to go up another $20,000.

Besides, you're not selling multiple items. You only need one buyer. Which would you rather have: 5 offers ranging from $365,000 to $380,000, or one offer at $400,000? I'd opt for the latter.

Now, pricing is an art and a science. We earlier said that your property was worth $400,000. That might be based on comps ranging from $390,000-$410,000. Maybe the market's hotter now, and you could get $410,000 for it. Maybe, strategically, you want to price it at $399,900. There are lots of things you can do within a reasonably narrow price range to maximize your sales price. Your agent can help you greatly there.

But would I deliberately price it low just to encourage multiple offers, hoping for a bidding war?

No.

Hope that helps.
2 votes Thank Flag Link Fri Jun 21, 2013
Kudos. Really good examples. People are so hung up on getting multiple offers instead of getting the right offers.
Flag Fri Jun 21, 2013
Don Tepper, Real Estate Pro in Burke, VA
MVP'08
Contact
In San Francisco most agents/brokers list properties on the low side to attract a lot of buyers and get overbids. Most buyers understand this and so it works.

You should speak with a reliable, reputable pro in your area to see how this strategy will play out there.

Best Regards,

Lance King/Owner-Managing Broker
King Realty Group

lance@king-realtygroup.com
415.722.5549
DRE# 01384425
1 vote Thank Flag Link Fri Jun 21, 2013
Price it right is the key. If it is worth 500K you price is 350K, chances you will get lot of low balls.
0 votes Thank Flag Link Sat May 31, 2014
Price it right is the key. If it is worth 500K you price is 350K, chances you will get lot of low balls.
0 votes Thank Flag Link Sat May 31, 2014
There are a number of pricing strategies for selling a home. One strategy is to list at a slightly lower price to possibly facilitate receipt of many offers, therefore, driving up the price of your home to your preferred price.

What is most important is to price your home at the appropriate price. Most traffic occurs in the first two weeks of your home being listed. One can easily loose a good buyer within the first two weeks and it can be on the market for longer than necessary if not appropriately priced.
0 votes Thank Flag Link Wed May 7, 2014
Yes, this is one viable strategy to generate a multiple offer situation.
0 votes Thank Flag Link Sat Jul 20, 2013
Hi Lakisha,
You have asked a very relevant question here.
If you were a buyer, you would be attracted to the lower price, and come to view.
You would pay its value, and some more if it goes to bidding.
If it was price at the market value some of the buyers may not visit, and you may get less activity.
If you were to price above the market, you may attract buyers who otherwise, may have a hard time getting into a home due to lower down payment or such factors.
So, it will depend on how you would like to do it, and based on existing market conditions, which may change from time to time.
Good luck & let me know if you need further info.
Best.
Shan Saigal
Broker-Referral Realty Silicon Valley
Dre #00768704
http://www.siliconvalleyhomeprice.com
0 votes Thank Flag Link Sun Jun 23, 2013
Lowering the price is not always the first thing to do. Take a walk through with your agent as if you are a potential buyer and look at the property with an open mind. There may be areas of the home that you can de-clutter, paint or spruce up. Also verify that the photos are current and plenty and showing the home in its best light. Be sure the curb appeal is also inviting and then follow the directions of your agent. They are the area expert. Best Wishes!
0 votes Thank Flag Link Fri Jun 21, 2013
In today's market, if you price it competively and within the ball park of your comps and it is in the best conditon and location you will attact multiple offers. You run the risk of pricing it too low and then having to raise it latter.
0 votes Thank Flag Link Fri Jun 21, 2013
Bev, you know comps are very misleading.
Flag Mon May 30, 2016
I would list at the price your trusted agent advises you to list at, myself I would would list at the value I think it would sell at for the condition it is in especially in the seller's market like we have now.

I would try though to list it in $25,000 increments so I can atttract two groups looking on thr MLS, most people have their buying agents set them up on a listing watch on the MLS,, they usually say send me everything under EXAMPLE---600,000 or 575,000 or 550,000

If you do set your price at 600,000 you will get the buyers searching up to 600,000 and buyers seaching from 600,000 to 625,000----two groups.


Best Regards,

Larry Gallegos
Real Estate Collaborative Specialist-Divorce

Broker Consultant, e-Pro Certified
CRS-Certified Residential Specialist
Luxury Home Specialist
ASR-Accredited Seller Representative
GRI-Graduate, Realtor Institute
SRES-Seniors Real Estate Specialist
ABR-Accredited Buyer Representative
ASP-Accredited Staging Professional

Better Homes and Gardens Real Estate, Mason-McDuffie
43430 Mission Blvd., Fremont, CA. 94539
(Corner of Mission & Mission Tierra)
Direct (510)-492-4872, Fax (510)-217-4249
mailto:Larry@LarryGallegos.com
Visit my Website at http://CustomBayHomes.com
dre license # 01253795
0 votes Thank Flag Link Fri Jun 21, 2013
Structuring the terms of a Listing is an art and a science:
Representing a Seller I would recommend less than Market; we defintely want multiple offers.
0 votes Thank Flag Link Fri Jun 21, 2013
Absolutely!
HOWEVER,
If you are not fluent in the art of jacking the price back up, you will have given away some of your equity, possibly unneccessarily.
-
Once the 'value' of your home has been determined. the price is used to compress the time requirement.
-
The right response to your question must be related to your selling urgency. That important piece is missing from your question.
0 votes Thank Flag Link Fri Jun 21, 2013
This is the most stupid trend in local real estate that we've seen in a long time.
A strong buyer's broker will not be intimidated by a bidding war. They'll see through the smoke and mirrors and urge their buyers to stay within their budget and at or below a reasonable target price.
Very few buyers will offer above market value, so creating a gaggle of meaningless low-ball offers just adds noise that Shakespeare would describe as:
"...a tale told by an idiot, full of sound and fury, signifying nothing." (Macbeth)
0 votes Thank Flag Link Fri Jun 21, 2013
Hi Lakisha, This is what some home sellers are doing; however, I would recommend to determine what you consider the home's fair market value by evaluating the home sales in your neighborhood the past 6 months with your Realtor. You can certaintly catch a buyers attention and get multiple offers by pricing your home in line with comparable sales.

I hope this information is helpful. If there is anything further I can do to assist, please feel free to contact me:

Natasha Green
Realtor/Code 3 Realty
#01409216
Direct: 408 921-1661
Email: natashagreen58@gmail.com
"A Realtor You Can Trust: Committed to Service Excellence"
0 votes Thank Flag Link Fri Jun 21, 2013
Lower than what?

Whatever you do, engage you realtor in preparing a Comparable Market Analysis. Factor certain things that may affect your property value --- improvements, amenities, condition. Is your area considered hot, hot, hot?

Decide on your pricing strategy --- but don't overprice. Even in a sellers market, the top reason why properties don't sell or attract attention is over-pricing.

And...you may like the bragging rights of attracting many offers...but do you have time to wade through many offers just so you can say you received a lot?

If buyers/agents are going to write offers for significantly over list price, how many of them are going to waive their appraisal contingency? Many write higher offers, and when the appraisal comes in lower than offer price, they take that opportunity to haggle.

Be strategic, be smart. You only need ONE really good offer.
0 votes Thank Flag Link Fri Jun 21, 2013
Lower price will get you more offers for sure so you have more option to choose best and highest offer.Some agents recommend to put the price close to recent sold data in the area so you get only qualified buyers to choose from select few offers.I hope it helps.
Web Reference: http://www.joesellshome.com
0 votes Thank Flag Link Fri Jun 21, 2013
That is what many people are doing. But be careful not to list it too low or you'll just get a lot of low offers as well as the higher offers you are looking for. Sit down with your agent and discuss the marketing plan and the recent sales and listings in your area.

Brian
0 votes Thank Flag Link Fri Jun 21, 2013
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